Norway has granted NOK3.94 billion ($427.54 million) in taxpayer-funded subsidies for two floating offshore wind test projects with a planned annual capacity of 0.3 terrawatt hours (TWh), Norwegian Government agency Enova said in a statement on Friday.
Enova has granted Fortius Offshore Wind NOK2 billion, and Fram Wind Solutions NOK1.94 billion.
Both plan to install two large offshore wind turbines with a capacity of 18.5 megawatts each, over the next five years.
Energy production will match the annual consumption of around 15,000 households.
The aim is to test and demonstrate new technology that can reduce the cost of generating energy from floating offshore wind.
"If they succeed in making offshore wind technology profitable enough, it will be a major step toward faster, large-scale deployment of renewable power," Enova said.
However, the sector continues to face questions over its commercial viability, with Germany recently allowing developers to return previously auctioned offshore wind sites in exchange for penalties.
Rising financing costs, overcapacity and declining revenue expectations have made projects increasingly difficult to deliver, highlighting the industry's continued dependence on government support.
(Reporting by Louise Rasmussen, editing by Terje Solsvik, Baird Maritime)